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That's a great question, because "payday loans" and "trustworthy" don't tend to be said in the same breath! That's pretty valid: they often come with extremely high interest rates and should be the last resort you consider if you're strapped for cash.
You'll usually pay much, much more in interest than you borrowed to begin with. But, with more than 2.5 million Americans each year who take out payday loans, it's important to know how to find a lender that's reputable.
Monday, October 18th
Check Into Cash should be the first resource you turn to if you need money fast. The company offers a range of loan products, including payday and installment loans, and with more than 650 brick-and-mortar locations you even have the option of applying online and picking up your funds in person. The BBB gives Check Into Cash a perfect "A+" rating and accreditation over almost 30 years in operation. This service is the clear winner among providers of payday loans.
Blue Trust Loans doesn't make you pay back your entire payday loan in a lump sum on the date of your next paycheck. Instead, they break it down into weekly, biweekly or monthly repayments - but with sky-high interest rates from 472% to 842%! The service is operated by a Native American tribe and your loan is governed by tribal law, not federal, so keep that in mind. The BBB gives Blue Trust Loans a respectable "A" rating, and they're an option to consider if you prefer to pay back over time.
Jora Credit is one of the most transparent options out there for quick cash loans. You can easily see exactly what you can borrow and how much you'll pay in interest on their website, before you even apply for a loan. Repayments are scheduled over time but can be paid in full whenever you choose. The BBB gives Jora Credit a fantastic "A" rating, but because this lender has so many states where they don't offer loans, they can't compete with higher-ranked providers that are available to more people.
Honest Loans is a referral website that takes your loan application and tries to match you with a network lending partner to get you the money you need. Because this company doesn't fund your loan directly, there are very little specifics about how much you can borrow or how much you'll pay in interest. There's also not much feedback about Honest Loans out there: no rating from the BBB and no customer comments. It may not be a bad place to connect with a payday loan company, but you have much more direct options available.
Zoca Loans is owned by Redbud Lending and offers quick cash that is repaid in installments instead of all at once. They don't come out and tell you how much you'll pay in interest on your payday loan of up to $1500, but their sample rate quote shows an APR of 795%! Combine that with a disappointing "B" rating from the BBB and numerous customer complaints, and it's easy to see why Zoca Loans gets a low ranking here.
How do payday loans work? They're meant to be short-term loans to hold you over until your next paycheck. You'll either have to repay the loan and all of the interest right at the time of your upcoming, scheduled payday, or you may be able to set up your loan with weekly, biweekly or monthly repayments. If you happen to get paid earlier than you expected or come into extra money, most payday loans can be repaid in advance, which will save you some money in interest fees.
These types of loans are popular for several reasons. First off, you rarely have to have good credit; many payday loan companies only ask for ID, a bank account number, and proof of a steady paycheck. Payday loans are also easy to get: some states have more in-person loan "stores" than McDonald's locations!
What are the downsides of a payday loan? Besides the obvious one, the extremely high interest rates, many borrowers find these loans hard to pay back. Up to 20% of payday loans go into default, and as much as 80% of loans are followed over or reborrowed within 30 days. As you might imagine, that racks up huge fees - translating into big bucks for the payday lender and even less in your pocket.
Now that you know the drawbacks of payday loans, how can you increase your chances of getting the money you need from a lender you can count on not to plunge you into deeper trouble? Look for these things when you're choosing a service for a payday loan:
TopConsumerReviews.com has evaluated and ranked the most popular sources of payday loans available today. We hope this information will help you choose a lender that will get you the cash you need with terms you can afford.
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